9911796707
TMI Blog2018 (11) TMI 375X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee claimed deduction of the entire LTCG on the ground that the entire LTCG was invested in acquiring a residential property viz., No.D-301, Vivarea, Koramangala, Bangalore (hereinafter referred to as "the new asset"). The Memorandum of Understanding (MOU) for purchase of the aforesaid property was entered into by the Assessee on 9.12.2010 much before the sale of the property at Noida which gave rise to the LTCG. As per the MOU, the cost of the new asset which was a flat was agreed to be purchased by the Assessee from Chalet Hotels Private Limited for a consideration of Rs. 2,50,24,000/-. The Assessee made payment of Rs. 37,53,600/- to the builder by cheques dated 30.11.2010, 6.12.2010 and 12.12.2010. 4. After sale of the Noida Property the Assessee made a payment of Rs. 88,10,246/- for acquiring the new asset in the following manner:- Amount invested in Koramangala House after the date of sale of Original asset Date Bank Statement Reference Amount Rs. 27.06.2012 State Bank of India 1335041 13.09.2012 State Bank of India 1335041 12.10.2012 State Bank of India 1335041 05.11.2012 State Bank of India 1335041 05.12.2012 State Bank of India 1335041 12.03.2013 S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al asset took place, or which is not utilised by him for the purchase or construction of the new asset before the date of furnishing the return of income under section 139, shall be deposited by him before furnishing such return [such deposit being made in any case not later than the due date applicable in the case of the assessee for furnishing the return of income under sub-section (1) of section 139] in an account in any such bank or institution as may be specified in, and utilised in accordance with, any scheme which the Central Government may, by notification in the Official Gazette, frame in this behalf and such return shall be accompanied by proof of such deposit; and, for the purposes of sub-section (1), the amount, if any, already utilised by the assessee for the purchase or construction of the new asset together with the amount so deposited shall be deemed to be the cost of the new asset : Provided that if the amount deposited under this sub-section is not utilised wholly or partly for the purchase or construction of the new asset within the period specified in sub-section (1), then,- (i) the amount not so utilised shall be charged under section 45 as the income of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he two-year period contemplated by section 54. So stating, the Tribunal allowed the relief claimed by the assessee. 5. There is no dispute that the building has been constructed within two years from the date of sale of the old building. The old building was sold in February, 1977. The new building was completed in March, 1977, the construction of which had commenced in 1976. Section 54 of the Income-tax Act so far as it is relevant provides : "Where a capital gain arises from the transfer of a capital asset to which the provisions of section 53 are not applicable, being buildings or lands appurtenant thereto the income of which is chargeable under the head 'Income from house property', which in the two years immediately preceding the date on which the transfer took place, was being used by the assessee or a parent of his mainly for the purposes of his own or the parent's own residence, and the assessee has within a period of one year before or after that date purchased, or has within a period of two years after that date constructed, a house property for the purposes of his own residence, then, instead of the capital gain being charged to income-tax as income of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... affirmative and against the Revenue. In the circumstances of the case, we make no order to costs." 11. As we have already seen, deduction u/s. 54 of the Act is allowed if a property being residential house is transferred and long term capital gain is derived by the assessee. If the assessee, one year before the transfer of old asset or one year thereafter purchased a new asset, he is entitled to deduction u/s.54 of the Act. If the Assessee constructs a new house, then the construction should be completed within a period of three years after the transfer of old asset. In the present case, the expenses for constructing the new residential house, is partly incurred prior to one year before the transfer and the entire LTCG has been invested in construction within two years after the transfer of the old asset. In such circumstances, the assessee is entitled to deduction u/s. 54 of the Act for the entire LTCG that was invested in construction of the new asset, as admittedly these investments were made within the period of 3 years from the date of the old asset. The facts are identical to the facts of the case of the decision of the Hon'ble High Court of Karnataka in the case of J.R. Su ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
